From The Wall Street Journal

A shale play that was left for dead has come roaring back in 2018.

The Bakken formation, which stretches from Montana to North Dakota, had long been considered by some in the energy industry to be played out.

Now the region is experiencing a comeback, luring investors as crude prices have surged. Oil production in North Dakota has climbed to records this year, hitting 1.27 million barrels a day in July.

That is leading to outsize gains for producers concentrated on the Bakken.

Whiting Petroleum Corp., which has operations in North Dakota, Colorado and Texas, is up 72% for the year so far. Continental Resources Inc. and Oasis Petroleum Inc. are up 24% and 57%, respectively.

“It’s interesting times in North Dakota,” said Pablo Prudencio, an analyst at energy consultancy Wood Mackenzie. “The Bakken has a story of its own right now.”

Several factors account for the Bakken’s recent rise, Mr. Prudencio said. U.S. oil futures surpassing $70 a barrel have spurred more drilling across the country. Additionally, cheaper acreage and improved crude transportation have made the area more attractive than some other major shale fields.

Namely, the Dakota Access Pipeline has made it cheaper to send crude to other parts of the country. Previously, much of the oil produced was transported by rail.

Drilling efficiency has also picked up, analysts said, meaning more crude comes out of each well.

While the Permian basin in Texas has become known as the most prolific oil region in the U.S., constraints to getting crude out of the region and transporting it to market have damped enthusiasm for producers working there.

The stocks of Permian basin producers Diamondback Energy Inc. and Concho Resourceshave advanced 7% and 6.5%, respectively, this year, while the broader SPDR S&P Oil and Gas Exploration and Production ETF, or XOP, is up 18% year to date.

“As folks were getting more concerned about pipeline capacity [in the Permian], the capital started to move away,” said Dane Gregoris, senior vice president at RS Energy Group.

Through much of the year, regional oil prices in North Dakota have stayed stronger than in Midland, Texas, where transportation challenges at times pushed prices more than $15 below the U.S. benchmark. But recently that divergence between Midland prices and West Texas Intermediate futures has narrowed, and as of Friday, was $7.10.

And Bakken production is far from overtaking that of the Permian. Bakken oil production averaged 1.3 million barrels a day in September 2018, compared with 3.4 million barrels a day in the Permian, according to the U.S. Energy Information Administration.

Some investors started to turn their attention to other shale plays about a year ago, when constraints in Texas began to emerge, said Mr. Gregoris. “You can see how that’s played out with all these Bakken names.”

“It’s a totally different ballgame,” he added.

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